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Celgene: It Takes an Ecosystem:

The Future for Biomedical Innovation

The challenges to sustained medical innovation leadership are clear. According to a new study published by the New England Journal of Medicine, Asian investments in biomedical research and development have increased 51 percent while US, Canada and European R&D expenditures have fallen nearly 7 percent. That’s a US$14 billion decline. Those numbers should serve as a wake-up call to leaders in both the public and private sectors. Governments, academia, patient advocacy groups and private sector research-driven companies are all essential parts of a vital medical innovation ecosystem. All need to be healthy and successful for the ecosystem to thrive. Successful collaboration among all these sectors of the ecosystem will deliver new cures for patients, reduce the burden on healthcare systems and grow economies.

Biopharmaceutical breakthroughs have contributed to a 22-percent drop in American cancer deaths over the last two decades. The number of cancer survivors has doubled in that time—from 7 million to 14 million. Since 1990, cancer patients have enjoyed 50 million additional years of life and generated US$4.7 trillion in additional economic activity, with 83 percent of life expectancy gains attributable to new treatments.

Just a generation ago, an HIV/AIDS diagnosis was tantamount to a death sentence. Since innovative treatments were introduced in the 1990s, the disease’s death rate has dropped by 80 percent, with new treatments responsible for 90 percent of the reduced mortality. Today, in most cases HIV/AIDS is being successfully managed with innovative treatments as a long-term chronic condition.

But patients aren’t the only ones who have benefited from the biomedical research ecosystem. So has the economy. Research-driven biopharmaceutical firms employ more than 810,000 people directly and support a total of 3.4 million jobs across the country.

All that economic activity generates tax revenue. In 2010, the government collected US$3.7 billion on the activity related to the Human Genome Project. With just that one year’s incremental tax revenue resulting from the Human Genome, the government recouped 97 percent of its 13-year investment in the Project.

But there are still many more health challenges to solve. Over the next 20 years, the number of new cancer cases is projected to increase by more than 50 percent, according to the World Health Organization. The incidence of Alzheimer’s and other forms of dementia in the United States will double by 2050. Without new medical innovations that change the course of these diseases, the burden of these conditions will overwhelm health systems and threaten economic growth.

Curing diseases like these will require substantial investments of time and money. Developing the average new drug takes over a decade and costs more than a billion dollars. The risk of failure is high. Hundreds of companies are working on new cancer treatments. Only a fraction of those are likely to produce new breakthroughs for patients.

The odds are long, but the returns in longer, healthier lives and stronger economic growth are astronomical. Each one percent reduction in U.S. cancer-related deaths delivers US$500 billion in value to society. Delaying the onset of Alzheimer’s by just five years could reduce healthcare expenditures by almost US$600 billion over the next 20 years.

The biomedical research ecosystem is closer than ever to achieving those goals. Globally, research-based biopharmaceutical companies spend US$135 billion every year on research and development. Biopharmaceutical company scientists are investigating nearly 1,000 treatments that could transform life-threatening cancers into chronic, manageable conditions. Another 100 are being developed as potential therapies for Alzheimer’s.

But converting those research initiatives into new therapies—and keeping the research pipeline flowing with promising new cures—requires more than science. It requires collaborative, integrated solutions.

And it requires policies that ensure the health of our nation’s ecosystem of innovation: increased support for the National Institutes of Health’s vital basic research mission, a strong, science-based Food and Drug Administration, and the sustainable market-based access and reimbursement for innovative medicines today that is necessary to incentivize the long-term, high-risk investment needed for new medical breakthroughs in the future.

For the sake of patients—and the broader economy—we must work together to help make this happen.

Robert J. Hugin is Chairman and CEO of Celgene Corporation and Immediate Past Chairman of the Pharmaceutical Research and Manufacturers of America.

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